The two biggest Daily Fantasy Sports providers in the United States, DraftKings and FanDuel, have stopped running paid contests in the New York market, as the state continues to fight them over operating rights. New York Attorney General Eric Schneiderman is at the front of the suit, trying to take their operations down since last year when he issued a cease-and-deist order. Both of the companies had been fighting back against the accusations, but with the legal fees starting to pile up, not even the billion dollar companies want to spend that much money.
Hoping for the Best Outcome
Schneiderman is claiming that their contests rely on chance, which is illegal under the current state laws. However, DraftKings and FanDuel state that they require skill, so the battle goes back and forth. During the suit, they were both allowed to continue their operations, but Schneiderman is relentless. Which is why these two parties have come to an agreement. The DFS websites will stop running paid contests in New York if the Attorney General will put a pause on the suit. As Schneiderman stated,
“As I’ve said from the start, my job is to enforce the law, and starting today, DraftKings and FanDuel will abide by it. Today’s agreement also creates an expedited path to resolve this litigation should that law change or upon a decision by the appellate division.”
The reason they are calling a temporary truce until September is to wait and see what the New York legislature decides. There is a bill to regulate and legalize daily fantasy contests, and if it passes, the state’s gambling claims will end. Here is hoping for the best outcome, whether it will allow New York residents to continue using DraftKings or FanDuel’s services or not.
In the Meantime No Paid Contests
Until a decision is reached, both of these companies have agreed to stop offering paid contests in the state, which is a little sad, as FanDuel is headquartered in New York. A spokesperson for the company stated,
“New York is a critical state for FanDuel. While it is disheartening for us to restrict access to paid contests in our home state, we believe this is in the best interest of our company, while we continue to pursue legal clarity in New York.”
DraftKings is also hard at work, trying to work with lawmakers to introduce fantasy sports legislation. New York is one of the biggest markets for DFS, so it is already a big blow for the websites to have to shut down operations there until September. Those people that use their services that live in New York will need to get daily fantasy sports action elsewhere for the time being.